The Issue The issue is whether Petitioner timely filed his request for claim form requesting reimbursement for certain covered expenses under the Florida Flexible Benefits Program--Reimbursement Plan.
Findings Of Fact Petitioner is a member of the faculty of the University of South Florida. He participates in the Florida Flexible Benefits Program--Reimbursement Program (Program). The Plan allows participants to pay certain eligible medical or dependent day care expenses with pretax earnings. Each year, during an open enrollment period, an employee may elect to participate in the Program and select an amount of salary to be deducted from his or her pay. The amount of salary so deducted is not subject to federal income tax, but is available to reimburse the employee for covered expenses. In order for the Program to continue to enjoy preferential treatment under the federal income tax law, Respondent, which administers the Program, must adhere to certain rules. Most relevant to this case is that that the deducted salary must be at risk. Specifically, an employee is not entitled to a refund of all or part of the deduction if he or she does not timely submit sufficient reimbursable expenses to exhaust his or her account. The Program brochure clearly warns participants of this "use it or lose it" rule. The plan year for the Program is the calendar year. In 1997, Petitioner was a participant in the Program. He and his wife chose not to submit claims for covered expenses, as they paid them during the year. Instead, they accumulated the receipts with the intent of submitting a single claim for their account balance at the end of the plan year. The Program sets a claims filing deadline of April 15 for filing claims arising out of the expenses paid in the preceding calendar year. The Program brochure warns that this deadline means all claims for expenses incurred during a plan year must be postmarked by midnight, April 15 of the following year to be considered for processing. Any claims received after this date will be returned to the participant unprocessed, regardless of the account balances. Participants should file claims as soon as the required documentation is obtained. This case involves only one issue: whether Petitioner timely submitted his claims for reimbursement under the Program. There is no issue concerning Petitioner's payment of these expenses or his account balance. There is no issue whether these expenses are eligible for reimbursement. In early March 1998, Petitioner and his wife collected their receipts for covered expenses from 1997. Petitioner completed a reimbursement form and addressed the envelope to Respondent at the correct address. Wanting to make copies of the materials, Petitioner did not immediately mail the package to Respondent. A few days later, prior to copying the materials or mailing the package, Petitioner's father became ill in the Mideast, where he lives. Petitioner and his wife agreed that she would copy the materials and mail the package to Respondent. On March 21, which marks the birthday of Petitioner's wife and a cultural holiday for Petitioner and his wife, Petitioner's wife telephoned her husband, who was still visiting his sick father. In the ensuing discussion, Petitioner learned that she had not yet mailed the package. They discussed the matter and again agreed that she would copy the materials and mail the package without further delay. Without further delay, Petitioner's wife copied the materials and mailed the package to Respondent at the correct address. She placed the package with sufficient postage in a mailbox across from her home. The package consisted of a claims reimbursement form and receipts for eligible expenses. It appears that she may have written an old return address on the envelope. Respondent never received the package. Respondent's procedures are carefully designed and executed to ensure that it will not lose a claim form. Repeated searches for the missing form never uncovered it. The package was lost after its mailing by Petitioner's wife and prior to its delivery to Respondent. Possibly, the incorrect address precluded notification to Petitioner of problems with delivery. Possibly, the package was just lost. Unfortunately, Petitioner learned only after the April 15 deadline that Respondent had never received the package.
Recommendation It is RECOMMENDED that the Department of Management Services, Division of State Group Insurance, enter a final order determining that Petitioner timely submitted the claim and eligible expenses that were the subject of this case. DONE AND ENTERED this 8th day of March, 2000, in Tallahassee, Leon County, Florida. ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 8th day of March, 2000. COPIES FURNISHED: Paul A. Rowell, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 Thomas D. McGurk, Secretary Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 Mohsen M. Milani 15927 Ellsworth Drive Tampa, Florida 33647 Julia Forrester Assistant General Counsel Department of Management Services 4050 Esplanade Way, Suite 260 Tallahassee, Florida 32399
The Issue Whether the proposed amendment to Florida Administrative Code Rule 69O-149.041 constitutes an invalid exercise of delegated legislative authority.
Findings Of Fact Golden Rule is a foreign insurer authorized to conduct insurance business in Florida and holds a certificate of authority authorizing it to transact the following lines of insurance in Florida: life, group life and annuities, and accident and health.1/ Pursuant to its certificate of authority, Golden Rule issues group health insurance policies in other states under which residents of Florida are provided coverage for hospital, surgical, or major medical expenses, or a combination of these, on an expense-incurred basis. Golden Rule’s group health insurance certificates have been issued pursuant to several master group contracts entered into between Golden Rule and group plan sponsors. The only conversion benefit for Florida certificate holders terminating their group health insurance policies under each of these master group contracts, which could have represented the agreed-upon consideration of the contracting parties, was the then-existing 1995 SHBP. Part VII of Chapter 627, Florida Statutes, governs group health insurance policies issued in Florida. Section 627.6675, Florida Statutes,2/ governs conversion insurance policies issued to terminating members of insured group health plans in Florida and provides, in pertinent part, as follows: Subject to all of the provisions of this section, a group policy delivered or issued for delivery in this state by an insurer or nonprofit health care services plan that provides, on an expense-incurred basis, hospital, surgical, or major medical expense insurance, or any combination of these coverages, shall provide that an employee or member whose insurance under the group policy has been terminated for any reason, including discontinuance of the group policy in its entirety or with respect to an insured class, and who has been continuously insured under the group policy, and under any group policy providing similar benefits that the terminated group policy replaced, for at least 3 months immediately prior to termination, shall be entitled to have issued to him or her by the insurer a policy or certificate of health insurance, referred to in this section as a "converted policy." * * * REQUIRED OPTION FOR MAJOR MEDICAL COVERAGE.--Subject to the provisions and conditions of this part, the employee or member shall be entitled to obtain a converted policy providing major medical coverage under a plan meeting the following requirements: A maximum benefit equal to the lesser of the policy limit of the group policy from which the individual converted or $500,000 per covered person for all covered medical expenses incurred during the covered person's lifetime. Payment of benefits at the rate of 80 percent of covered medical expenses which are in excess of the deductible, until 20 percent of such expenses in a benefit period reaches $2,000, after which benefits will be paid at the rate of 90 percent during the remainder of the contract year unless the insured is in the insurer's case management program, in which case benefits shall be paid at the rate of 100 percent during the remainder of the contract year. For the purposes of this paragraph, "case management program" means the specific supervision and management of the medical care provided or prescribed for a specific individual, which may include the use of health care providers designated by the insurer. Payment of benefits for outpatient treatment of mental illness, if provided in the converted policy, may be at a lesser rate but not less than 50 percent. A deductible for each calendar year that must be $500, $1,000, or $2,000, at the option of the policyholder. The term "covered medical expenses," as used in this subsection, shall be consistent with those customarily offered by the insurer under group or individual health insurance policies but is not required to be identical to the covered medical expenses provided in the group policy from which the individual converted. ALTERNATIVE PLANS.--The insurer shall, in addition to the option required by subsection (10), offer the standard health benefit plan, as established pursuant to s. 627.6699(12). The insurer may, at its option, also offer alternative plans for group health conversion in addition to the plans required by this section. (Emphasis added) The underscored portion of Section 627.6675(11) above was enacted by Chapter 97-179, Laws of Florida, and became effective on May 30, 1997. In 1997, when the Legislature amended Section 627.6675(11) as indicated in paragraph 4 above, Section 627.6699(12) read, in pertinent part, as follows: By May 15, 1993, the commissioner shall appoint a health benefit plan committee composed of four representatives of carriers which shall include at least two representatives of HMOs, at least one of which is a staff model HMO, two representatives of agents, four representatives of small employers, and one employee of a small employer. The carrier members shall be selected from a list of individuals recommended by the board. The commissioner may require the board to submit additional recommendations of individuals for appointment. As alliances are established under s. 408.702, each alliance shall also appoint an additional member to the committee. The committee shall develop changes to the form and level of coverages for the standard health benefit plan and the basic health benefit plan, and shall submit the forms and levels of coverages to the department by September 30, 1993. The department must approve such forms and levels of coverages by November 30, 1993, and may return the submissions to the committee for modification on a schedule that allows the department to grant final approval by November 30, 1993. * * * 5. After approval of the revised health benefit plans, if the department determines that modifications to a plan might be appropriate, the commissioner shall appoint a new health benefit plan committee in the manner provided in subparagraph 1. to submit recommended modifications to the department for approval. § 672.6699(12), Fla. Stat. (Supp. 1996), Compare § 627.6699(12), Fla. Stat. (1999) (containing the same language). In 1997, when the Legislature amended Section 627.6675(11), as indicated in paragraph 4 above, the 1995 S&BHBPs had been adopted by reference and incorporated in Florida Administrative Code Rule 4-149.041 (the predecessor to Florida Administrative Code Rule 69O-149.041).3/ Given the adoption of the specific S&BHBPs by rule in 1995, given the language of Section 627.6699(12), Florida Statutes, in 1997 (which referred to the approval and adoption of a specific set of benefits on a specified time schedule), and given the meaning in the law and in common usage of the word "established,”4/ it is reasonable to conclude, and it is concluded, that the statutory language in Section 627.6675(11) as passed in 1997--“the standard health benefit plan, as established pursuant to s. 627.6699(12)”--referred to the 1995 SHBP, which was then in existence and had been specifically adopted by rule at the time of enactment of Chapter 97-179, Laws of Florida. On October 8, 2004, in Volume 30, No. 41 of the Florida Administrative Weekly, OIR noticed a proposed amendment to Florida Administrative Code Rule 690-149.041, which would substitute the 2003 S&BHBPs, developed by a benefits committee convened in 2002, in place of the 1995 S&BHBPs, and would incorporate, by reference, Order 69745-03-CO into the proposed rule. The proposed amendment states, in the portion relevant to this challenge, as follows: (d) New and renewal policies for the Basic and Standard policies issued on or after August 1, 2003, May 1, 1995, must include the Basic and Standard Health Benefit Plans approved by Order 69745-03-CO signed by the Director on July 25, 2003, (OIR B2 95) pursuant to Section 627.6699(12), F.S., which is incorporated herein by reference . . . . As specific authority for the proposed amendment to the Rule, OIR cited Section 626.9611, Florida Statutes (2004), which authorizes the Department of Financial Services or the Financial Services Commission (“FSC”) to adopt rules necessary or proper to identify specific methods of competition or acts or practices which are prohibited by the Unfair Insurance Trade Practices Act; Section 627.6699(13)(i), Florida Statutes (2004), which provides that the FSC may establish regulations setting forth additional standards to provide for the fair marketing and broad availability of health benefit plans to small employers in this state; and Section 627.6699(16), Florida Statutes, which addresses the applicability of other state laws to Florida small employer groups. As the laws being implemented by the proposed amendment to the Rule, OIR cited to Sections 626.9541(1)(b), (g)2., (x)3., and 627.6699(3)(g), (v), (5)(a), (7), (12)(c), (13)(b), Florida Statutes. The proposed amendment to the Rule, however, clearly also “implements, interprets, or prescribes law or policy,”5/ as to Section 627.6675(11), Florida Statutes, and would appear to require insurers offering Conversion Policies under Section 627.6675 to offer the 2003 SHBP, rather than the 1995 SHBP, as the Conversion Policy option referred to in Section 627.6675(11), Florida Statutes. Section 120.54(3)(a), Florida Statutes, requires OIR to make reference in its notice of proposed rulemaking to the sections or subsections of the Florida Statutes being implemented. OIR did not do so with respect to Section 627.6675 or Subsection (11) thereof. The FSC has not approved the proposed amendment to the rule. As Litow and others testified, a mandatory conversion policy, sometimes referred to as a guaranteed issue policy, must be issued to an individual (whether previously insured in a small group market, or another group market) upon his request, without consideration of his risk characteristics (without underwriting). In contrast, an underwritten policy is an insurance policy issued after the health status of the individual applying for coverage is evaluated, and the insurance company makes a decision whether to accept or reject the risk. In the Small Employer Group market, governed by Section 627.6699, Florida Statutes, it is the employer who makes the decision about whether or not to purchase the health insurance policy at the quoted premium rate. By contrast, in the Converted Policy market, it is the covered individual who makes the decision about whether or not to purchase the health insurance policy at the quoted premium rate. The concept of anti-selection in health insurance is that only those persons who would tend to benefit most from purchasing an insurance product would have incentive to do so, and others would not. The credible and convincing testimony of Litow, corroborated by the testimony of OIR’s own expert, James Swenson, shows that the benefits under the 2003 SHBP are more expansive than the benefits offered under the 1995 SHBP. For example, the lifetime benefits under the 2003 SHBP is five million dollars, as compared to one million dollars under the 1995 SHBP. Where the 1995 SHBP had a benefit limitation of $200,000 for organ transplants, the 2003 SHBP has no limitation and also covers several organ transplants, including liver, pancreas, and kidney, not covered under the 1995 SHBP. Additionally, the 2003 SHBP includes a new benefit for alcohol and substance abuse not available under the 1995 SHBP. As established by expert actuarial testimony at the final hearing, the actuarial impact on the Conversion Policy market (See Section 627.6675) of utilizing the 2003 SHBP instead of the 1995 SHBP would be to increase the expected average claims losses experienced by insurers participating in the Conversion Policy market. While asserting the position that the 2003 SHBP would apply to Converted Policies for all insurers required to issue such policies under Section 627.6675(11), Florida Statutes, OIR has never reviewed or analyzed the actuarial impact of the 2003 SHBP mandated by the Department for use in the Converted Policy market. The 2003 SHBP increases and/or adds benefits in the area of organ transplants, lifetime coverage limits, emergency room and hospital, and alcohol and drug abuse treatment. The actuarial impact of replacing the 1995 SHBP with the 2003 SHBP in the Converted Policy market governed under Section 627.6675 is substantial. However, the minutes of the 2002 Small Employer Benefits Plan Committee meetings between June 6, 2002, and September 27, 2002, in evidence in this proceeding, offers no reference to analysis of this type. Also in evidence as Golden Rule Exhibit 7, the Florida Small Employer Benefit Plan Committee Report of 2002, does not refer to any data review or analysis of the impact of changes in the Converted Policy market. Nor is reference to data review or analysis of the impact of the Standard Health Benefit Plan changes in the Converted Policy market contained in the order approving the small employer standard and basic health benefit plans, signed by Insurance Commissioner McCarty on July 25, 2003. Frank Dino, OIR’s chief actuary and that agency’s designated representative at this hearing, was an advisor to the Florida Small Employer Benefit Plan Committee. He testified that he did not know whether actuary members of the 2002 Committee ever analyzed differences between the 1995 and 2003 SHBPs using any sub-standard market data. He admitted, in his opinion as an actuary, that the use of substandard market data, as opposed to standard (underwritten) market data, would make a difference in the analysis. By previous deposition taken in these proceedings, Dino testified that he was unable to formulate any actuarial opinion on whether Conversion Policies have a higher level of anti-selection than small employer carrier policies. He also testified that he did not know whether an increase of lifetime benefits from $1 million to $5 million would have a greater actuarial effect in the Converted Policy market than the Small Employer market. Similarly, Dino was without an opinion regarding the difference in effect between the Small Employer market and the Converted Policy market regarding other changes from the 1995 SHBP to the 2003 SHBP. As previously noted, compared to the 1995 SHBP, the 2003 SHBP eliminates the emergency room deductible, doubles outpatient rehabilitation benefits, adds alcohol and substance abuse benefits, adds benefits for preventative care, and removes caps on organ transplant benefits. Dino testified that it was unlikely that anyone at OIR would have a higher level of information about any of these topics than he. Richard Robleto, the Deputy Insurance Commissioner, asserted that he attended every meeting of the 2002 Florida Small Employer Benefit Plan Committee. He was unable to recall any discussion by the 2002 Committee about whether changes from the 1995 SHBP to 2003 SHBP would have a different impact on Conversion Policies than on Small Employer policies. Glen Volk, a consulting actuary, was a member of the 2002 Florida Small Employer Benefit Plan Committee. He performed a premium pricing comparison between the 1995 SHBP and the 2003 SHBP, but neither his database nor his assumptions included data from the Converted Policy market. An OIR analysis of the actuarial impact of the 2003 SHBP in the Converted Policy market, undertaken by Dino following his deposition and before his hearing testimony on March 30, 2005, uses data provided by James Swenson of Blue Cross/Blue Shield of Florida, which confirms Litow’s opinion that a very small number of very high claims, which would result from the benefit increases from the 1995 SHBP to the 2003 SHBP, are extremely detrimental to the insurer issuing Converted Policies. Swenson’s Blue Cross data shows the following: 98.8 percent of claims averaged $10,000; only 1.2 percent of claims were over $100,000; but that 1.2 percent of the claims resulted in 22.3 percent of total the claims costs. Because the 2003 SHBP increases the potential of high cost benefits, and results in higher utilization of high cost medical services, the result is a very high trend increase in the whole insurance plan. OIR and personnel have failed to take into account medical cost trends from the date of the collected data to the projected current date. The medical cost trend from 1988 to 2005 has averaged in excess of 10 percent per year. For high cost claims (such as organ transplantation claims), the average annual increase is even higher, as much as 25 percent. At this rate of trend, claims costs for high expense procedures will double in less than three years. When claims costs for Converted Policies exceed what can be legally charged to the converted policyholders, that excess must be either absorbed by the carrier or passed on to the individually underwritten group members in the form of increased premiums. Those individually underwritten policyholders who are healthy, and can pass medical underwriting for new insurance coverage, will do so to lower their premiums. The result is that as the remaining insureds on average become less and less healthy as a result of this anti-selection process; and as claims among a carrier’s insureds become higher as a percentage of the total number of insureds, claims costs will tend inevitably to spiral still higher than rate increases can cover. In these circumstances, the insurer, particularly a small to medium-sized insurer, can never collect enough premium to cover claim losses. Applying appropriate actuarial analysis to the determination of the Impact of the 1995 SHBP contrasted to the 2003 SHBP, in the Converted Policy market, the evidence shows a significant adverse actuarial impact on Petitioner and similarly situated insurers of Converted Policies under Section 627.6675, Florida Statutes. Actuarial impact is determined by comparing the cost of one insurance scenario to another. One first analyzes a base scenario, then makes a change in the base scenario, and compares the expected cost of the base scenario to the expected cost of the changed scenario. Contrasting the base scenario (the 1995 SHBP) to the changed scenario (the 2003 SHBP), a variety of actuarially significant changes occur. The 2003 SHBP increases benefits for organ transplants, both in terms of types of transplants covered, and the removal of the dollar limit on coverage. The 1995 SHBP limited coverage of organ transplants to $200,000. The 2003 SHBP provides unlimited coverage and additional types of organ transplants not covered under the 1995 SHBP. These additional transplant procedures are extremely expensive, ranging currently in price from $200,000 to more than $400,000. Further, the 1995 SHBP limited lifetime benefits to $1 million-- the 2003 SHBP raises that limit five-fold. Using actuarial standards and practices developed by the Society of Actuaries, Litow opined, and it is found, that the actuarial impact of the changes from the 1995 SHBP to the 2003 SHBP in the Converted Policy market could reasonably result in increased insurance claims costs of 40 percent or more. The likely increased utilization caused by using the 2003 SHBP in the Converted Policy market is obvious when comparing the out-of-pocket expenses of someone needing a $350,000 transplant under the 1995 SHBP, compared to the 2003 SHBP. Assuming the transplant would have been covered at all under the 1995 SHBP, the patient’s out-of-pocket costs would have been $150,000. Under the 2003 SHBP, the out-of-pocket cost is $10,000. When out-of-pocket costs to the patient for the same procedure drop so dramatically, utilization will increase. Consequently, the challenged rule’s proposal to abandon the 1995 SHBP for use as a Converted Policy option and to substitute the 2003 SHBP in its place arbitrarily and capriciously exposes group carriers to unrecoverable business losses from Converted Policies issued under Section 627.6675(11). OIR’s asserted position and evidence presented in support of that position that compliance with the Federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), Pub. Law 104-191, requires that Sections 627.6675(11) and 627.6699(12), Florida Statutes, be read as requiring that the most current standard plan (policy form) developed for use in the Small Employer Group market under Section 627.6699(12) (presently, the 2003 SHBP), be the available Conversion Policy option under Section 627.6675(11), is not credited. Such an interpretation of the pertinent statutes in that manner, as a condition of Florida’s maintaining an acceptable “State Alternative Mechanism” (“SAM”) to HIPAA’s guaranteed availability requirements in the individual market, is unpersuasive in view of the more credible testimony at hearing from Robert Roth, an expert witness regarding HIPAA requirements. Roth’s testimony establishes that HIPAA did not require Florida (or any state) to adopt a SAM. When the State of Florida elected to adopt a SAM, nothing in HIPAA required the SAM to include the offering of conversion plans as an element of the SAM. The vast majority of states with a SAM do not require the offering of conversion plans to satisfy HIPAA’s guaranteed availability requirements. Florida’s SAM would not violate HIPAA, even if neither of the Small Employer Group standard plans (the “1995 SHBP” or the “2003 SHBP”) were offered as a Conversion Policy. The provisions of 45 CFR Section 148.128 (a)(1)(iii)(A), allows Florida’s SAM to offer comprehensive coverage offered in the individual market. Availability of such coverage pursuant to Section 627.6675(10), Florida Statutes, allows Florida’s SAM to meet those requirements without regard to the SHBPs. HIPAA allows Florida the flexibility to adopt a SAM that complies with either 45 CFR Section 148.128 (a)(1)(iii)(A) or 45 CFR Section 148.128 (a)(1)(iii)(B). In order for a SAM to be in compliance with HIPAA, there is no requirement that HIPAA eligible individuals be offered policies under both sub-paragraphs (A) and (B) of that regulation. Even if Florida repealed Section 627.6675(11), Florida Statutes, altogether, such action would have no effect on Florida’s SAM under HIPAA. There is no evidence in the record that OIR referred to HIPAA in any of its notices or deliberations concerning development of the 2003 SHBP or the rule being challenged in these proceedings. The activities of the 2002 Benefits Committee constituted free-form agency action, and offered no point of entry concerning whether the 2003 SHBP could or should be a required Converted Policy form. OIR’s Order 69745-03-CO provided no pre-final order point of entry under Chapter 120, Florida Statutes. The proposed rule is arbitrary and capricious.
Findings Of Fact Petitioner, EVELYN S. WRIGHT, as an employee of Metropolitan Dade County and a member of the State and County Officers and Employees Retirement System, elected to transfer into the Florida Retirement System (FRS) effective December 1, 1970. (Exhibit 3) On April 10, 1972, Petitioner terminated her employment with Metropolitan Dade County and applied for FRS disability retirement benefits pursuant to Section 121.091(4), Florida Statutes, on May 22, 1972. (Exhibit 2) Petitioner's application for FRS disability retirement benefits was initially denied by the Administrator of the Florida Retirement System on August 21, 1972. (Exhibit 4) On January 6, 1975, Petitioner inquired of the Supervisor of the Respondent's Disability Determination Unit, Mr. David Ragsdale, as to the possibility of withdrawing the accumulated contributions in her retirement account. At this time, Petitioner, was advised by Mr. Ragsdale that a withdrawal of contributions would cancel her membership rights in the Florida Retirement System. (TR - p.9) Respondent forwarded to Petitioner, by letter dated January 7, 1975, the appropriate form for making application for a refund of accumulated retirement contributions. The transmittal letter specifically advised the Petitioner that, "Should you complete and return the enclosed card, M81, you would have no further rights or service credit with the Division of Retirement." (Exhibit 5) On January 14, 1975, Petitioner executed, and her employer verified, an application for refund of accumulated retirement contributions. The application form clearly stipulated: "I hereby make application for refund of my accumulated contributions in the Florida Retirement System. I do hereby waive for myself, my heirs and assignees all rights, title and interest in the Florida Retirement System." (Exhibit 6) Petitioner's application for refund of contributions was received by the Respondent on January 17, 1975. Respondent refunded to Petitioner her accumulated contributions in the amount of $3,056.02 by Voucher No. 237738, Warrant No. 0309435, dated January 28, 1975. (Exhibit 6) The attorney for Petitioner, John H. Abramson, was advised by the undersigned hearing officer by telephone that Leave to Take Deposition was granted. By letter from the said attorney the Division was notified that Petitioner's file was being closed.
The Issue Whether Petitioner made a timely election to participate in the Florida Flexible Benefits Plan (Plan) in accordance with Rule 60P-8.0041(2), Florida Administrative Code and if not, should his participation in the Florida Flexible Benefits Plan (the Plan) for the Plan Year of December 1, 1991, through December 31, 1992, be denied. Whether Petitioner would be entitled to reimbursement from the Plan for medical expenses incurred prior to November 12, 1992, provided it is determined that Petitioner made a timely election to participate in the Plan in accordance with Rule 60P-8.0041(2), Florida Administrative Code.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: At all times material to this proceeding, the Petitioner was a full- time employee of the University of Florida, Institute of Food and Agriculture Science (IFAS) in Hardee County, Florida and as such, was eligible to participate in the Plan Medical Reimbursement Account provided he timely elected to participate and was otherwise qualified. The Respondent is the state agency charged with the responsibility of administering all state insurance plans for state employees in the State of Florida. As part of its insurance program, the State of Florida offers the Florida Flexible Benefits Plan. The Plan is a benefit program for state employees under which specified, incurred medical expense may be reimbursed. The period of coverage for the Plan material to this proceeding was December 1, 1991 through December 31, 1992. Petitioner did not enroll in the Plan during the open enrollment period for all state employees conducted by the Division during the month of October 1991. During the summer of 1992, and again in October 1992, (sometime after the child was born on October 5, 1992) the Petitioner's wife, Karen S. Weaver, contacted the Division by telephone to inquire about, and to get clarification on, enrolling in the Plan based on a "Change In Family Status" (the child' birth) after the effective date of the Plan, December 1, 1991. On both occasions, Karen Weaver talked with an enrollment agent of the Division and, other than the child's date of birth, no effective date was discussed. The enrollment agent advised Karen Weaver that the Petitioner could not apply until after the birth of the child due to the documentation needed concerning the child's birth. Neither Karen Weaver nor Petitioner were ever advised that with proper certification of pregnancy from the wife's doctor that Petitioner could apply before the birth of the child. After the wife's last conversation with the Division, the Petitioner completed and signed a Reimbursement Account Enrollment/Qualifying Status Change Form, Form FB-2 (the Form) which was dated October 23, 1992. Whether the Petitioner returned the Form to IFAS's personnel office by mail or hand delivery is not clear from the record. However, a notation on the bottom of the Form indicates the Form was received by the personnel office of IFAS on November 9, 1993. The Form was received by the Division on November 12, 1992. The instructions in the Revised September 1991 Florida Flexible Benefits Plan booklet on when Form FB-2 must be submitted provides in pertinent part as follows: Requests must be made by submitting a completed Enrollment/Qualifying Status Change Form, FB-2 (available from your personnel office), to DSEI within 31 days of the event's occurrence. . . . The instructions on the reverse side of Form FB-2 as to the submission of the form provides: Return this completed from to your personnel office. It must be received at DSEI within 31 days of your employment or change in family/employment status. The personnel office is responsible for sending the form immediately upon its receipt to DSEI. THE EFFECTIVE DATE OF PLAN PARTICIPATION OR CHANGE IN FAMILY/EMPLOYMENT STATUS WILL BE THE DATE THE SIGNED AND PROPERLY COMPLETED FORM AND DOCUMENTATION ARE RECEIVED BY DSEI. Petitioner was accepted in the Plan with an effective date of enrollment being November 12, 1992, the date the Division received the Form from Petitioner. The Petitioner elected to contribute $900.00 to the Plan Medical Reimbursement Account to fund reimbursement payment for incurred medical expenses. The Petitioner's acceptance in the Plan was based on the Division having: (a) considered the child's birth as a qualifying status change and; (b) determined that the Petitioner had timely elected to participate in Plan in accordance with Rule 60P-8.0041(2), Florida Administrative Code, in that the Form has been completed and dated (not received by the Division) within 31 calendar days of the occurrence of the qualifying status change. There was insufficient evidence to establish facts to show that within 31 calendar days of occurrence (child's birth) of Qualifying Status Change the Petitioner had: (a) placed the Form with the U.S. mail or similar carrier for delivery to the personnel office of IFAS for submission to the Division; (b) placed the Form with the U.S. mail or similar carrier for submission with the Division; (c) hand delivered the Form to the personnel office of IFAS for submission to the Division or; (d) hand delivered the Form to the Division. Notwithstanding that the notation on the bottom of the Form indicates that the personnel office of IFAS had the Form in its possession as early as November 9, 1992, there is competent substantial evidence to show that the Division did not receive the Form until November 12, 1992. Likewise, there is competent substantial evidence to show that the Respondent did not make a timely election to participate in the Plan by submitting the Form to the Division within 31 calendar days of occurrence (child's birth) of qualifying status change as required by Rule 60P-8.0041(2), Florida Administrative Code, notwithstanding that the Form was dated October 23, 1992, well within the first 31 calendar days of occurrence (child's birth) of the qualifying status change. On December 14, 1992, the Petitioner submitted a claim for medical expense reimbursement for his wife and infant daughter for medical expenses incurred in the month of March, April, June, October and December, 1992. By letter dated December 24, 1992, the Division advised the Petitioner that expenses incurred prior to his enrollment date of November 12, 1992, (the date the Form was received by the Division) were not eligible for reimbursement and to resubmit claims for services incurred after November 12, 1992. There was no evidence presented as to whether the Petitioner resubmitted the medical expenses incurred during the month of December 1992, for reimbursement. The Petitioner contends that the Division should grant Petitioner an exception to the requirement that the effective date must be the date Form FB-2 is received by the Division and allow the effective date in this instance to be the date of occurrence, October 5, 1992, (date of child's birth) of qualifying status change. The Petitioner's contention is based primarily on the fact that the verbal instructions from the Division was misleading, and that the Division had made an exception by allowing the Petitioner to participate in the Plan even though the Petitioner had not timely elected to participate in the Plan in accordance with Rule 60P-8.0042, Florida Administrative Code. The Division denied the Petitioner's request for an exception contending that there is no provision for granting an exception in either case. The Division also contends that date Form FB-2 is completed and signed is the date to be used to in calculating the 31-calendar day requirement to determine if an employee has timely elected to participate in the Plan in accordance with Rule 60P-8.0041(2), Florida Administrative Code. The Division's position is expressly stated in Petitioner's exhibit 8 wherein William H. Lindner, Secretary, Department of Management Services, is responding to a letter from Petitioner and states: In your letter you indicated that an exception had been made in the enrollment process. It had not. Subsection 60P- 8.0041(2), F. A. C. (copy enclosed) indicates that an election to participate in the reimbursement accounts must be made within the first 31 calendar days of the occurrence of the Qualifying Status Change. Our records indicate that you made your election on October 23, 1992 which is within 31 days of the birth of your child on October 5, 1992. The records indicate that the Form was signed on October 23, 1992, well within the 31-day requirement but was not received by the Division until November 12, 1992, some seven days after the 31-day requirement had expired.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Respondent, Department of Management Services, Division of State Employees' Insurance enter a final order finding that the Petitioner failed to timely elect to participate in the in Plan in accordance with Rule 60P-8.0041(2), Florida Administrative Code, was not qualified to participate in the Plan, and any participation in the Plan allowed by the Division was void ab initio. It is further recommended that the Division refund all contributions made by the Petitioner to the Plan after adjustment for any reimbursement for medical expenses that may have been made to the Petitioner by the Division. DONE AND ENTERED this 16th day of February, 1994, in Tallahassee, Florida. WILLIAM R. CAVE Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of February, 1994. APPENDIX TO RECOMMENDED ORDER NO. 93-5571 The following constitutes my specific rulings, pursuant Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties in this case. Petitioner, Gregory E. Weaver's Proposed Findings of Fact. The following proposed finding(s) of fact are adopted in substance as modified in the Recommended Order. The number in parenthesis is the Finding(s) of Fact which so adopts the proposed finding(s) of fact:1(1); 3-4(5); 5-6(9); 7(6,11); 9(11); 10(6,11); 11(9,16); 12(9); 13(8); 14-15(13); 16(15); 17(16); 18(5) and 19(6). Proposed Finding of Fact 2 is neither material nor relevant to this proceeding. Proposed Finding of Fact 8 is more properly covered in the Conclusions of Law. Proposed Finding of Fact 20 is more an argument than a finding of fact. Respondent's Proposed Findings of Fact. The following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parenthesis is the Finding(s) of Fact which so adopts the proposed finding(s) of fact: 1(1,2); 2(3); 3(4,6,9); 4(9); 7(13); and 8(14). Proposed finding of fact 5 is not supported by competent substantial evidence in the record. See Findings of Fact 10 and 11. Proposed finding of fact 6 is adopted in substance as modified in Findings of Fact 6 and 11, except for the first sentence which is rejected as I find no evidence as to the Form being mailed. Proposed findings of fact 9 and 11 ( there is no proposed finding of fact 10) are adopted in substance as modified in Finding of Fact 7 and 8. COPIES FURNISHED: Gregory Weaver Route 1, Box 423 Wauchula, Florida 33873 Augustus D. Aikens, Esquire Division of State Employment Insurance 2002 Old St. Augustine Road, B-12 Tallahassee, Florida 32301-4876 William H. Lindner, Secretary Department of Management Services Knight Building, Suite 307 2737 Centerview Drive Tallahassee, Florida 32399-0950 Alecia Runyon, Director Division of State Employees Insurance 2002 Old St. Augustine Road, B-12 Tallahassee, Florida 32301-4876 Paul A. Rowell, General Counsel Department of Management Services Knight Building, Suite 307 2737 Centerview Drive Tallahassee, Florida 32399-0950
The Issue Whether the State of Florida Employees Group Health Self Insurance Plan is responsible for paying medical expenses incurred by Petitioner's newborn child where Petitioner had only individual coverage in effect at the time of the child's birth.
Findings Of Fact The State of Florida makes available to its employees several group insurance programs. In the area of health insurance, employees may choose to participate in the State of Florida Employees Group Health Self Insurance Plan (State Group Plan), or they may enroll in other plans, such as HMOs. The State Group Plan is a plan of self insurance established by the State and administered by Blue Cross/Blue Shield. This plan is described in general terms by a Plan Brochure and is described in more detail by the contract of insurance contained in the State Self Insured Health Plan's Benefit Document (Plan Document). The State Group Plan is regulated by those rules contained in Chapter 22K, Florida Administrative Code. At the time employees begin their employment with the State, they may select which, if any, of the optional health insurance programs offered by the State they desire. Thereafter, employees may only join one of the insurance programs or switch between programs during an annual open enrollment period. An employee who elects coverage from the State Group Plan may purchase either individual coverage or family coverage. Individual coverage provides health insurance coverage for only the individual employee. Family coverage provides health insurance coverage for the individual employee and the employee's eligible dependents for whom the employee has elected coverage. Family coverage does not begin until after the application for coverage is processed and the premium for family coverage is paid. The monthly premium for family coverage is paid one month in advance. An employee can, but he does not have to, wait for an open enrollment period to switch from individual coverage to family coverage. An employee having individual coverage may change to family coverage at any time during the year prior to the acquisition of an eligible dependent or at a time that is within 31 days of the date of acquisition of any eligible dependent. If family coverage is requested after the acquisition of the dependent, there is a gap in the coverage of the dependent between the date of acquisition and the date coverage begins. There is no retroactive coverage. An employee who completes the pertinent application for family coverage, who submits the application, and who pays the first month's premium for family coverage prior to the acquisition of the dependent has family coverage in place at the time the dependent is acquired through birth, adoption, or other means. Consequently, there is no gap in coverage between the date of acquisition and the effective date of coverage for that dependent. Petitioner is an associate professor of management and Director of the Doctoral Studies Program in the College of Business Administration at Florida International University (FIU). Petitioner teaches courses in a variety of areas including business administration, wage and salary administration, and insurance benefits. Petitioner enrolled in the State Group Plan in 1982. Petitioner was knowledgeable about the State Group Plan and had, from time to time, compared its benefits to those of other plans. At the time of their marriage, Petitioner and his wife reviewed their insurance coverage and decided not to convert their individual policies to one policy with family coverage. From the date of his initial enrollment until April 1989, Petitioner had individual coverage. On March 8, 1989, Petitioner executed the forms that were necessary to change his individual coverage to family coverage. Petitioner's family coverage went into effect on April 1, 1989, after the application was processed and the premium was collected. In March 1988 Petitioner married Annette Wellinghoff. Petitioner and his wife retained their respective individual insurance policies after their marriage. Mrs. Kroeck was not a state employee so the insurance coverage she had was independent of her husband's coverage. In August 1988 Petitioner and his wife learned that Mrs. Kroeck was pregnant with an expectant due date in February 1989. In August 1988, Petitioner telephoned the personnel office at FIU to inquire as to obtaining coverage for the expected child. The general information given Petitioner in response to his questions was accurate. He was told that he could convert his individual coverage to family coverage, if he so desired, during the open enrollment period scheduled for December 1, 1988, through January 31, 1989. There was no evidence that Petitioner specifically inquired as to when he should begin family coverage in order to have the child's birth expenses covered. Likewise, there was no evidence that Petitioner was specifically told that he could convert his coverage to family coverage after the birth of his child and have the medical expenses covered from the time of birth. Petitioner did not request any written information about the conversion process, nor did he request an application form to effectuate the conversion. Petitioner did not know the name of the person with whom he was speaking, only that she was a representative of the personnel office. Petitioner did not contact the FIU Personnel Office again until after the birth of his son. Instead, Petitioner relied upon his wife to take care of securing health insurance. Petitioner delegated this responsibility to his wife because she was also experienced and knowledgeable in matters concerning employee benefits and health insurance plans. Mrs. Kroeck has had at least 3 years experience in health insurance benefits administration. In December 1988 general information relating to the open enrollment program was mailed to all state employees, including Petitioner. Included in the information package were a Plan Brochure for the State Group Plan and an enrollment form for the various insurance options offered to State employees. Mrs. Kroeck read the application form and a portion of the Plan Brochure. Neither Petitioner nor his wife read, prior to the birth of their child, the section of the Plan Brochure entitled "Purpose of This Brochure". That section states that the Plan Brochure is not intended to be a contract document, that it is intended to give a summary of available benefits, and that an employee should contact either his personnel office or the office of the Division of State Employees' Insurance for the answer to questions. The employee is told that the contract document is the Plan Document and that a copy of the Plan Document is on file at the employee's personnel office. That section also contains the following admonition: The agency personnel office will provide needed assistance to State officers and employees enrolling in the Plan; however, such officers or employees should take care to assure that they receive the coverage applied for and that proper deductions are made. On January 9, 1989, Mrs. Kroeck telephoned the personnel office at FIU with questions relating to listing the unborn child as a dependent on the application form that had been mailed to Petitioner in December. Her questioning centered on how to complete the name, date of birth and social security number for an unborn dependent. Clara Martinez, the employee in the personnel office to whom Mrs. Kroeck spoke, does not recall talking to Mrs. Kroeck on January 8, 1989. At the time of this conversation, Ms. Martinez knew that family coverage had to be in place prior to the acquisition of a dependent for the dependent to be covered as of the date of acquisition. If Ms. Kroeck had asked Ms. Martinez a question to which Ms. Martinez did not know the answer, Ms. Martinez would have contacted the office of the Division of State Employees Insurance in Tallahassee for the answer. The evidence fails to establish that Mrs. Kroeck was misinformed by Ms. Martinez or that she specifically inquired as to the effective date of the family coverage. On February 19, 1989, Mrs. Kroeck had her baby. The baby was admitted to the hospital in his own name and incurred, in his own name, expenses in the amount of $4,274.95, for which Petitioner and his wife were responsible. On March 8, 1989, Petitioner signed an application to change his individual coverage to family coverage. Family coverage became effective on April 1, 1989, after the application was processed and the premium for family coverage was collected. At the time of the birth of his son, Petitioner had individual coverage issued through the State Group Plan. Petitioner's son was not a beneficiary under the State Group Plan at the time the medical expenses which are at issue were incurred. Petitioner's request for payment of the medical expenses incurred by his son at birth was denied by Respondent and this proceeding followed.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent, Department of Administration enter a final order which denies the claim for payment of the medical expenses incurred by Petitioner's son prior to the effective date of family coverage. DONE AND ENTERED this , 27th day of December, 1989, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of December, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-4929 The following rulings are made on the proposed findings of fact submitted on behalf of Respondent. 1. The proposed findings of fact in paragraph 1 are adopted in material part by paragraph 7 of the Recommended Order. 2. The proposed findings of fact in paragraph 2 are adopted in material part by paragraph 7 of the Recommended Order. 3. The proposed findings of fact in paragraph 3 are adopted in material part by paragraph 8 of the Recommended Order. 4. The proposed findings of fact in paragraph 4 are adopted in material part by paragraph 9 of the Recommended Order. 5. The proposed findings of fact in paragraph 5 are adopted in material part by paragraph 9 of the Recommended Order. 6. The proposed findings of fact in paragraph 6 are adopted in material part by paragraph 9 of the Recommended Order. 7. The proposed findings of fact in paragraph 7 are adopted in material part by paragraph 11 of the Recommended Order. The proposed findings of fact in paragraph 8 are adopted in material part by paragraph 13 of the Recommended Order. The proposed findings of fact in paragraph 9 are rejected as being subordinate to the findings made. The proposed findings of fact in paragraph 10 are adopted in material part by paragraph 12 of the Recommended Order. The proposed findings of fact in paragraph 11 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 12 are adopted in material part by paragraph 12 of the Recommended Order. The proposed findings of fact in paragraph 13 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 14 are adopted in material part by paragraph 10 of the Recommended Order. The proposed findings of fact in paragraph 15 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 16 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 17 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 18 are rejected as being unsubstantiated by the evidence as to Ms. Alam and as being unnecessary to the conclusions reached as to Ms. Martinez. The proposed findings of fact in paragraph 19 are rejected as being subordinate to the findings made. The proposed findings of fact in paragraph 20 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 21 are adopted in material part by paragraph 13 of the Recommended Order. The proposed findings of fact in paragraph 22 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 23 are adopted in material part by paragraph 8 of the Recommended Order. The proposed findings of fact in paragraph 24 are adopted in material part by paragraph 18 of the Recommended Order. The proposed findings of fact in paragraph 25 are adopted in material part by paragraph 16 of the Recommended Order. The proposed findings of fact in paragraph 26 are adopted in material part by paragraph 5 of the Recommended Order. The proposed findings of fact in paragraph 27 are adopted in material part by paragraph 4 of the Recommended Order. COPIES FURNISHED: Augustus Aikens, Jr., Esquire Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 Kark G. Kroeck 9853 Costa del Sol Boulevard Miami, Florida 33178 Alette A. Lhutes, Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550 William A. Grieder, Esquire Office of the General Counsel Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550
The Issue Whether at the time of his father's death, Armando Martinez, Jr., was a "dependent beneficiary" of his father, a vested member of the Florida Retirement System, so as to be entitled to his father's retirement benefits?
Findings Of Fact Armando Martinez, Jr., was born on February 22, 1974, to Natalie M. Martinez and the late Armando Martinez, Sr. In 1992, when Armando, Jr., was eighteen years old, Mr. and Mrs. Martinez were divorced. The following year, 1993, less than two weeks after Armando, Jr.'s, nineteenth birthday, Armando Martinez, Sr., died. The cause of death was liver cancer, a disease from which Ms. Martinez presently suffers. At the time of his death on March 7, 1993, Mr. Martinez was a vested member of the Florida Retirement System. A municipal employee, he had been a bus operator. At some point close to commencement of his employment, slightly more than ten years prior to his death, Armando Martinez, Sr., had executed a Form M-10. The form named his wife, Natalie, as his primary beneficiary. Armando, Jr., the only child of Armando, Sr., and Natalie Martinez, was named as the sole contingency beneficiary. Following Mr. Martinez, Sr.'s death, Ms. Martinez disclaimed Florida Retirement System benefits. She did so in order for Armando, Jr., as the contingent beneficiary, to be able to receive the benefits. On February 17, 1997, the Division of Retirement denied Armando, Jr., survivor benefits. Had Mr. Martinez, Sr., died one-year and several weeks earlier, that is, prior to Armando, Jr.'s eighteenth birthday, the Division would have approved distribution of survivor benefits to him. But, although he was still a high school student, since he was older than nineteen by a few days at the time of his father's death, the Division required proof that Armando, Jr., had received half of his support from his father at the time of his father's death. No such proof was provided to the Division prior to or at the time of its preliminary denial. In fact, in his 1992 tax return, Mr. Martinez did not claim his son Armando, Jr., as a dependent. In this formal administrative proceeding, however, Armando Martinez, Jr., provided such proof, proof which was lacking until hearing. The year 1992 was very difficult for Armando Martinez, Jr., and his family. His parents separated, Armando, Jr., lived with his mother. Armando, Sr., lived elsewhere. Prior to his death, divorce proceedings were finalized. In the meantime, Ms. Martinez had lost her job. She remained unemployed for the entire year and in early 1993 as well. Armando, Jr., was still in high school at the time of his father's death. During the 1992-93 school year, to support himself and his mother, he obtained work part-time while he remained in school. Ms. Martinez paid the rent for their apartment at a rate of between $370 and $500 per month. The monthly phone bill of Ms. Martinez and Armando, Jr., was approximately $50; utility payments $70; groceries $300; gasoline $10, automobile insurance $100; and school supplies $40. There were other expenses, clothes, for example, that occurred from time-to-time. In addition to minimal government support to Ms. Martinez and Armando, Jr.'s, part-time employment income, Armando, Jr., was supported by cash payments provided by his father. Two or three times a month, Armando's father and a girl friend, Karen Jones, would drive to the front of the house. Because of his illness, Mr. Martinez remained in the car while Ms. Jones brought cash, usually between two and five hundred dollars in an envelope to the front door. On more than one of these occasions, Ms. Jones, the envelope, and the cash were observed by friends of the family at the moment of delivery. Ms. Martinez log of the estimates of these payments totals approximately $8,500, an amount in excess of Mr. Martinez's income reported in his 1992 tax return filed before his death in 1993 to be $6,389.00. But, Mr. Martinez, Sr. had access to other means of support and other monies including proceeds from insurance policies. The $8,500 provided to Armando, Jr., by Armando Martinez, Sr. constituted more than half of Armando, Jr.'s, support for the year 1992 and up until Mr. Martinez, Sr.'s, death in early 1993.
Recommendation Accordingly, it is hereby recommended that the Division of Retirement recognize Armando Martinez, Jr., to have been the dependent beneficiary of Armando Martinez, Sr., at the time of Mr. Martinez, Sr.'s, death, and therefore entitled to retirement benefits. DONE AND ORDERED this 27th day of January, 1998, in Tallahassee, Leon County, Florida. DAVID M. MALONEY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 27th day of January, 1998. COPIES FURNISHED: Robert B. Button, Esquire Division of Retirement Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Natalie Martinez Suite 3811 3801 Northgreen Avenue Tampa, Florida 33624 Paul A. Rowell, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950 A.J. McMullian, III, Director Division of Retirement Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560
The Issue Whether Petitioner is entitled to participate in the Deferred Retirement Option Program (DROP) of the Florida Retirement System (FRS), for the period September 1, 1998, through and including September 30, 1999.
Findings Of Fact Petitioner is a former employee of the School Board of Miami-Dade County (School Board) and is a retired member of FRS. In September 1998, Petitioner became eligible to participate in DROP by virtue of reaching 30 years of service with the School Board. In September 1998, Petitioner asked Respondent for an estimate of her retirement benefits. In January 1999, the estimate of Petitioner's retirement benefits was prepared by Respondent and mailed to Petitioner. During the 1998-99 school year, Petitioner had difficulties in her dealings with a new school principal. 1/ Petitioner testified that she delayed applying for DROP because she believed that her relationship with her employer would improve and she could continue to work as a teacher. Petitioner also testified that School Board administrators gave her erroneous information and misled her as to their intention to permit her to continue to teach. Petitioner argues that she would have elected to participate in DROP beginning September 1, 1998, had her employer told her the truth about her employment status. In this proceeding, Petitioner argues that she be permitted to participate in DROP effective September 1, 1998, on equitable grounds, without specifying the equitable principles upon which she relies. On October 27, 1999, Petitioner completed her application to participate in DROP and filed the application with the School Board's personnel office. Respondent received the completed application via facsimile on November 3, 1999. The first application sent in by Petitioner requested that her DROP participation start retroactive to September 1, 1998. Respondent, through its staff, denied that request and informed Petitioner that she would have to submit a second application, referred to by staff as a corrected application, requesting a start date of October 1, 1999. Pursuant to those instructions, Petitioner submitted a second application requesting that her start date be October 1, 1999. Petitioner's challenge to Respondent's denial of her request to accept her participation in DROP retroactive to September 1, 1998, was timely. Petitioner was later terminated from her position with the School Board. 2/ Respondent has been paid her drop benefits for the period beginning October 1, 1999, and ending when the School Board terminated her employment. Petitioner has not been employed by a FRS employer since the School Board terminated her employment.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a final order denying Petitioner's request for benefits under DROP for the period September 1, 1998 to September 30, 1999. DONE AND ENTERED this 10th day of August, 2001, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 10th day of August, 2001
Findings Of Fact Petitioner retired from employment with the State of Florida effective January 1, 1976, and began drawing retirement benefits on that date. During 1979, she worked for the South Florida State Hospital, her former employer, on a temporary basis while continuing to receive retirement compensation of $235.46 monthly. At the request of the South Florida State Hospital, Petitioner worked from June 7 through August 10, and September 7 through December 6, 1979. On September 28, she reached five hundred hours of employment for the calendar year. Therefore, Petitioner exceeded five hundred hours of state employment during the months of September, October, November, and December, 1979. Respondent seeks return of retirement compensation for the last three days of September and for all of the months of October, November and December, plus ten percent annual interest. This amounts to $729.93 in retirement compensation plus $36.04 interest through April 30, 1980.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That Petitioner be ordered to repay the State of Florida retirement compensation in the amount of $729.93 plus ten percent interest compounded annually. RECOMMENDED this 12th day of August, 1980, in Tallahassee, Florida. R. T. CARPENTER Hearing Officer Division of Administrative Hearings Department of Administration Room 101 Collins Building Tallahassee, Florida 32301 (904) 488-1777 Filed with the Clerk of the Division of Administrative Hearings this 12th day of August, 1980. COPIES FURNISHED: Mrs. Sarah H. Hoyle 1201 S.W. 17th Street Fort Lauderdale, Florida 33315 Augustus D. Aikens, Esquire Division Attorney Division of Retirement Cedars Executive Center 2639 North Monroe Street Suite 207C - Box 81 Tallahassee, Florida 32303 Christopher M. Rundle, Esquire South Florida State Hospital 1000 S.W. 84th Avenue Hollywood, Florida Mr. A. J. McMullian, III State Retirement Director Cedars Executive Center 2639 North Monroe Street Tallahassee, Florida 32303
